Physical stores are not dead - Accent Group

Physical stores are not dead. Nor is about either physical or digital stores, but how you seamlessly combine the two and deliver on customer experience, Accentr Group's chief digital officer, Mark Teperson, claims.

“We know that a customer who shops between our physical stores and online channels is three times more likely to be a high value customer in our business," Teperson told CMO during the Adobe Symposium in Sydney. "It’s incredibly important, and our competitor advantage. We have had to reimagine how we think about it, to deliver digital and physical seamlessly,”

Unlike other traditional retailers, Accent, which wholesales brands such as The Athlete’s Foot, Platypus, HypeDC, Skechers, Vans, Timberland, Merrell, Sperry, Saucony, and CAT, is opening more physical stores, not closing them down.
This, combined with digital innovation, has seen the company thrive in a period of uncertainty.

It was six years ago that the board sponsored the idea of investing behind digital for the future, to complement what the group had been investing in stores, Teperson said.

“Digital wasn’t instead of, it was in addition to, which is a defining difference in many businesses now - it’s about investing very heavily in both digital and physical,” he said. “We have built a reputation creating great in-store experiences. Our challenge was how to translate that into digital context, and how we live up to the idea that the customer wants to feel like it’s all one brand, which is much harder than it sounds.”

It was no easy feat, with legacy systems and constant changes to consumer trends, but Accent worked hard at creating the right foundation so they could live up to consumer expectations at scale.
The entire strategy came down to something simple: Listening to customers.

“We do a lot of consumer research in market, we sought to understand what customers wanted from us as we started to unlock more digital experience," Teperson continued.

“The surprise for us was uncovering just how many customers wanted to do click and collect from a store. It’s difficult to understand why a customer wanted that – surely if you buy something online you want to deliver it to your house, it seemed counterintuitive.

“So click and collect was one of the first omnichannel experiences we delivered, and overnight it became about 10-20 per cent of our digital sales. It was wonderful to see the actions supported the research, and that inspired us to continue the path.”

From this customer insight grew another digital experience – ship from store.

“We realised, why not open that inventory in stores up to consumers, inventory which we may not have in our warehouse. Ship from store ended up being 30-50 per cent of our total digital sales very quickly; we basically doubled our online sales overnight, and we did it without buying a single new piece of inventory, we just used what we already had," Teperson said.

“We started thinking about our stores not only as experience centres for customers, but as distribution centres for product. We’ve taken an established, fixed asset everyone thought could only serve a single purpose, and used it to serve customers everywhere."

That has unlocked $110 million in inventory and 447 distribution points across Australia, and radically improved through-put.
This, in turn, had a transformative impact on the business, and the way Accent thought about digital, and how it pivots with changes in consumer preferences.

It also inspired the launch of same day delivery, and continued investment in content – the next competitive frontier, and data – the next major currency.

“We continue to invest in digital experiences, communication, and we use data to create segments and experiences-that’s where our huge focus is now," Teperson explained. "We are trying to codify our data so we can use it and deliver great experiences. Of course, not all data is useful. It’s easy to get swept up in capturing everything, but you must as what you can do with it to create a better experience.

“Our next challenge is content velocity, to produce enough content to talk to all those segments in a way that is meaningful. Now, we need five times more content than you had yesterday to serve new segments.”

To achieve this, Accent in vested in a division within the company called The Agency. This saw graphic design and photography spun out into a disruptor, and complemented by videography, motion graphics and copy writing. This completes the suite of content creators the business requires to scale with the marketing technology platforms.

As for the future, Teperson said there are two things keeping him awake at night: The competitor that doesn’t exist today, and what the customer wants tomorrow.

“We spend a lot of time understanding demographics, consumer behaviours and listening to our customers so we can better predict what that looks like,” he said.

“Agility is important. We still have some way to go, but it’s about listening. Follow the customer and you’ll never have to look for growth. It’s simple, don’t overcomplicate it. Check in and listen to customers, they’ll tell you want they want and all you need to do is deliver really well on it.

“Many businesses overcomplicate that process because of corporate ego, there needs to be more openness.”

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